That means your true profit is $700,000, which is the amount on which you’ll pay long-term capital gains tax. Unless there are extenuating circumstances, your tax rate would be 20%. But wait ...

This calculator shows how much capital gains tax you will pay on the sale of residential property in the 2024-25 tax year.

For long-term capital gains, you fall into the 15% tax bracket, so you calculate your long-term capital gains tax separately as 15% of $10,000: $1,500. For 2024, your tax bill is roughly $12,053.

Now that you know how to calculate capital gains tax, here is an in-depth example. ... Dale’s cost basis in the property is the original purchase price of $1,800,000. Step 2: ...

Calculating capital gains is relatively straightforward. It involves subtracting the adjusted basis from the sales price of the home. Your original question mentions that you’ll net $650,000 on ...

Understanding capital gains tax is essential for savvy investors. If you’re aiming to maximize your returns, you need to know when you’ll encounter capital gains taxes and how to deal with them.